The UK government is expected to ditch proposals to introduce zonal pricing in the country’s electricity market.
Industry sources said they expected Energy Secretary Ed Miliband (pictured) to outline the move this week.
It will be welcomed by a large majority of renewables developers as many in the sector were opposed to the measures, arguing the pricing uncertainty would make it difficult to reach final investment decisions on large-scale generation projects.
The decision is seen as vital to pave the way for a successful AR7 Contracts for Difference auction this year.
The move will end years of uncertainty and confirm the country is sticking with the current national approach to energy.
The Guardian and other media outlets have reported the decision to abandon zonal.
Energy consultancy Afry found in research earlier this year that the claimed energy bill savings from a move to zonal pricing were overestimated and are more likely to result in higher bills for consumers if investment was negatively impacted.
It had the potential to add a £9.6 billion cost to consumers, the report found.
The research was sponsored by RWE and six other energy developers and investors, including SSE and ScottishPower.
Octopus Energy was in favour of zonal pricing research it supported showed there was “overwhelming support” for the move among Scottish businesses.
A DESNZ spokesperson said: “We don’t comment on speculation.”